S.Korea: Bleak Outlook for Domestic Shipbuilding Industry

Domestic shipbuilding companies are forecasted to struggle in the next two to three years due to unfavorable business conditions. Some claim that large-sized shipyards must diversify their businesses to overcome the crisis. Hana Institute of Finance (Hanaif) said on Wednesday "Local shipbuilding industry will continue to face difficulties as the amount of new orders and delivery decreases. Some shipyards could be subject to restructuring additionally."
"Shipbuilding companies’ delivery volume for this year is predicted to drop over 10% against last year. Delivery delay and cancellation are expected to continue until 2012" Hanaif prospected. The institute also remarked that whether the volume of new orders will recover is hard to tell until issues regarding the backlog of orders and excessive shipping are resolved.
Researcher Lee Eun-Chang said "South Korea’s large-sized shipyards that have overcome the crisis in the 1970s and 1980s must now cope with today’s crisis by business diversification. They must now build eco-friendly vessels, polar navigating vessels, ocean plants, cruises and wind power stations. Small and medium sized shipyards must ensure internal stability by focusing on the type and shape of the vessels they make in order to respond to the crisis."